Can I Get A Business Loan With Bad Credit?

Yes. As mentioned above, we have a number of options available. There are a lot of different routes of funding available and the business loan market continues to grow.

Although funding through your bank might prove tricky, there are plenty of specialist lenders out there ready to support your business, despite previous credit problems.

What Are The Options?

Here are the choices available when looking to secure a bad credit business loan:

Unsecured Business Loans

Unsecured business loans used to be the domain of the high street banks, but that’s all changed with a number of peer to peer and specialist lenders entering the market. An unsecured business loan can be arranged for most businesses, as long as the loan is considered affordable.

Asset Finance

Asset finance is a great option for businesses that have lots of assets but are struggling for capital. Asset finance can be used to raise money against existing assets, or for buying new ones. As the asset is taken as security for the loan, the risk is lower to the lender, increasing the chances of your application being accepted.

Merchant Cash Advance

Merchant cash advances are ideal for businesses that take a large amount of money each month through their card terminal. They allow you to raise money quickly and repay the lender by automatically taking a set percentage off each card sale and paying it directly to the lender. The acceptance rates for merchant cash advances are very high.

Invoice Finance

Invoice finance is another popular option for businesses with a poor credit history. If the business is owed a lot of money at any one time through invoices, there is a good chance that they will qualify for invoice finance.

Once arranged, the lender releases a high percentage of the value of any acceptable invoice issued as soon as its raised, easing the cash flow of the business. Invoice finance is an excellent tool for businesses who must accept delayed payment terms.

Will I Pay More Due To My Adverse Credit?

The rate charged will usually be slightly higher if your credit history is poor. How much higher is down to the type of product chosen and the security offered to the lender.

Unsecured business loans offer very little security to the lender in the event of payments falling behind, meaning the rate charged will increase quickly.

Asset finance, on the other hand, offers strong security to the lender, meaning they are less likely to lose money in the event of default. As a result, the increase in the cost will be much smaller than products with less security.

The key to ensuring your costs don’t increase too much is to offer more security to the lender, wherever possible.

Getting Started

Although we offer an online comparison service, if you have a poor credit history, it would be better to talk through your circumstances with one of our business funding experts. Unlike high street banks, they will listen to the full picture, and take a sensible view on any blips you may have suffered.

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The Commercial Finance Experts

ABC Finance Limited is authorised and regulated by the Financial Conduct Authority Registration No. 304671. The Financial Conduct Authority does not regulate all of our products. Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up the repayments on a mortgage or any debt secured on it. If you consider consolidating existing loans or unsecured debt you need to be aware that if you extend the term of the debt you may be increasing the total amount that you repay. The Information in this website is subject to UK regulatory regime and is restricted to UK consumers. However, there may be links to third party sites which may or may not have these same restrictions.